Increasing R&D Spending Will Not Lead to Innovation, But This Will

By: Rob Hoehn

In an analysis of high performance innovators (called in this article the “Global Innovation 1000”), researchers made a surprising discovery: “spending more money does not open the doors to innovation.”

For a lot of enterprise-level organizations, the general belief is that spending more money on research and concept development will lead to more new innovations and better results (like top line revenue growth or cost savings). Instead the researchers found that there were a few key company values that led innovators to have positive results: embed innovation in the business strategy, focus on innovation culture, involve leadership in innovation, leverage customer insights, hone the idea selection process, and give energy to creating disruptive change.

But the actions and tactics that support those six qualities serve as the six key job functions of an innovation department:

Research. Innovators should be scanning the horizon for information and signals from competitors, customer insights, market signals and other trends. Those findings will inform ideation campaigns, business strategy, leadership decisions, and more.

Share Best Practices. Innovators must discover what’s working in another part of the organization and force multiply its success by applying it elsewhere. Rinse. Repeat.

Idea Collection. Visibly assigning a place for ideas to mingle and for people to collaborate is a great way to support innovation culture, but it also serves the triple purpose of creating a mine for new and promising ideas, an incubator for selected ideas, and a parking lot for ideas that the world isn’t yet ready for. That’s how you find both incremental and disruptive change.

Idea Connection. This means connecting ideas to people, decision makers resources, and other ideas. Doing it visibly further elevates the innovation culture and having a truly great idea selection process makes those connections manageable and impactful.

Training. Invest in your people by training them in innovation best practices: how to brainstorm, how to recognize great ideas, how to grow and test good ideas, and more. That professional development will go a long way towards improving your overall workplace culture while also building innovation capacity.

Communication. Perhaps the most important tool for building an innovation culture is communicating inside and outside of a company where you’re going, what’s working, what you’ve learned, and recognizing who got you there.

To learn more about the role of an innovation department, download our infographic on the subject.

By Rob Hoehn